The UK property market is failing lots of people, with rising levels of homelessness and people living in unsuitable accommodation. Social investment has clear potential to catalyse and scale those innovations in property that benefit those in greatest need.
We have seen social investment used by charities and social enterprises to deliver affordable homes, provide specialist accommodation and support transitional housing. We will use social investment to help provide a home for people. We want to see social investment contribute to a fairer and more inclusive housing market that provides safe, secure and affordable homes to those in need and where the lives of vulnerable people are improved through housing that facilitates better care and wellbeing.
Social investment can help tackle the UK's housing crisis by increasing the supply of suitable housing and helping homelessness and housing charities to develop new funding streams.
The UK is in the midst of a housing crisis. Rising levels of homelessness are evident in the increase in rough sleepers and families living in overcrowded, unsuitable and insecure accommodation. This is in large part due to insufficient new affordable housing to meet the growing need, exacerbated by declining grant options for genuinely affordable new homes, and the poor quality of some private rented accommodation. Not only is adequate housing a basic right, but poor housing can have knock-on effects on many other aspects of people’s lives – such as health and employment and education.
Older people and people with disabilities find it even more difficult to find suitable accommodation that facilitates their care and support needs. Even though people with learning disabilities would often prefer to live independently in their communities - and in spite of evidence that this reduces costs for commissioners and achieves better outcomes for those individuals – there is insufficient specialist housing to allow this. This can result in people being placed in unsuitable institutional facilities, sometimes at considerable distance from their families.
Social investment can provide housing and homelessness charities with:
Capital to build or acquire more homes. This could be to scale up existing housing services or to pioneer interventions using property. Examples of this type of social investment include charity bonds, secured bank loans and social property funds.
Risk capital to develop new services and revenues. This type of investment includes unsecured loans and equity as well as social impact bonds which focus on prevention of homelessness.
Our housing induction slides provide further information.
We are particularly keen to support
- Supported accommodation models – assisting charities in meeting their growing property needs for people who need additional support, through bonds and social property funds. This includes increasing the supply of community-based housing for people with learning disabilities and testing ‘housing first’ approaches to long term homelessness.
- Scaling transitional accommodation models - investments which help tenants within the system move into ownership or into the private rented sector. This may provide specialised housing for care leavers, ex-offenders and victims of domestic abuse. Pressure on funding for support and housing costs is making it difficult for charities to provide transitional housing to people experiencing homelessness, particularly young single homeless people.
- Continuing to support the growth of community-led housing models, particularly in an urban context – this may be through a combination of development finance, community shares and grants from foundations.
- Equity investment in additional social housing via social property funds and Real Estate Investment Trusts – to attract institutional capital to address the gap that is emerging as grants for affordable homes decline, without requiring housing associations to take on more debt.
- Scaling innovative housing models which deliver employment and training, as well as housing